Bharti Airtel has acquired 100% of the equity in Warid Telecom Uganda for an estimated US$100million, in news broken by Reuters just before TowerXchange issue 3 went to print. The deal was expected to bring Airtel’s market share in Uganda to around 39%, very similar to MTN who have around 40%. Also competing in the market are Uganda Telecom Ltd (UTL), Orange Uganda and iTel.
The implications for the tower industry could be significant. In 2012, Eaton Towers acquired an estimated 400 towers from Warid Telecom Uganda, combining them with a further 300 sites acquired from Orange Uganda. With 260 of those cell sites already shared between the two operators at the time of the transaction, as a result of a conscious, co-ordinated rollout, the deal to buy Orange and Warid’s networks gave Eaton Towers over 1,000 tenants, meaning they had “scale, pre-existing revenue, and an ability to run a bigger business from day one,” according to CEO Alan Harper in his interview in issue 1 of TowerXchange.
In 2011 American Tower paid US$89m to MTN Uganda for 51% equity in joint venture towerco ATC Uganda, to which 1,000 of MTN’s towers were transferred. UTL’s towers had also been believed to be on the market recently, although towerco’s appetite for the portfolio may have been limited due the proximity of so many UTL sites to the ATC Uganda and Eaton towers already being marketed for co-location. Over half of of Uganda’s towers are operated by independent towercos. According to the GSMA, there were a total of 3,067 cell sites in Uganda in 2012, 1,249 of which were off-grid.
This month’s deal between Airtel and Warid was described by Airtel’s Managing Director and CEO (International) Manoj Kohli as the “first in-market acquisition” in the telco’s history, and remains subject to regulatory and statutory approval. With Airtel’s Africa Towers towerco strategy still unclear, the Indian-owned operator has been an enthusiastic tenant of shared towers in the recent past in several of the seventeen African countries in which they operate.